Recent geopolitical and weather-related disruptions have caused volatility across the energy wholesale market, leading to significantly higher prices than pre-COVID levels.
Analysts expect this to continue, with global demand, infrastructure costs and policy changes predicted to impact wholesale pricing in upcoming years.
With this in mind, business energy experts Utility Bidder have offered their advice on the immediate steps businesses should take to control their energy costs before further increases put additional pressure on their bottom line.
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Switch energy providers and lock in the best possible energy rate
Looking for a new energy deal can often be less of a priority than other tasks, but your business could be worse off financially if you let your current deal continuously renew. When your current deal is coming to an end, browse new deals on business electricity comparison websites. Negotiating with your current supplier may secure a better deal, but shopping around often yields the most competitive rates.
Business owners should not only look at different providers but also at different types of energy tariffs. Fixed tariffs offer budget certainty, while variable rates allow businesses to benefit from falling prices. The best choice depends on market conditions and your risk tolerance.
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Conduct an energy audit
While this requires an upfront investment, the potential savings can be transformational, particularly for businesses operating across multiple sites. Energy audits help identify where energy is being wasted and can allow you to implement quick fixes and reduce costs. Different businesses will require different levels of audits, which come at different costs. A desktop audit analyses energy bills and data without a site visit, whereas a walk-through audit requires a visual inspection to identify potential issues.
The most comprehensive audit involves a detailed analysis, multiple site visits and the use of expert equipment to asses energy performances. Energy auditors may also create a detailed plan outlining specific energy-saving measures, cost estimates and potential energy savings for each recommended measure.
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Consider renewable energy sources
UK businesses are being urged to reduce their carbon footprints and become more green by installing solar panels and exploring other renewable energy options. Costs have significantly decreased in recent years, and solar panels require minimal maintenance, making them an ideal option for SMEs with limited operational budgets.
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Install an energy monitor
An energy monitor is a device which is attached to your electricity meter and in turn, tracks how much electricity your business is using. Although many people believe energy monitors are the same as smart meters, they are, in fact, different. As well as tracking electricity usage, energy meters also monitor the amount of greenhouse gas emissions produced by your business and detect any irregular energy consumption patterns, which will help to reduce your business’s bills.
Chris Shaw, CEO at Utility Bidder, comments on how UK businesses can reduce their energy bills:
“Unlike consumers, UK businesses don’t have the safety net of an energy price cap which has sadly, meant that many small businesses have had to close their doors. Although rising energy costs may be out of the hands of business owners, some steps can be taken to reduce energy usage, which will have a knock-on effect when it comes to receiving your energy bill.”
“There are simple changes that can be made, such as switching from incandescent bulbs to LED, which use 75% less energy, and turning off non-essential equipment. However, it’s also important to pay attention to your current energy deal and work out if you could be paying less with a different provider. “
“With the right strategy, businesses can take control of their business costs. Staying informed on market trends will help you to navigate the challenges of fluctuating energy prices, and using a business energy comparison website will allow you to browse a range of deals more efficiently.”
